23.07.202112:39 Forex Analysis & Reviews: Gold is stalling, but it is saving up strength for a breakthrough

In recent days, the mood of the yellow asset has been very changeable. Gold fell on Monday, rose slightly on Tuesday, collapsed to a 2-week low on Wednesday, and again found the strength to get up on Thursday.

The decline in gold in the middle of the working week was significant. Against the background of the strengthened dollar and the growing yield of 10-year US bonds on Wednesday, the quotes dived to the lowest level since July 8, and barely managed to stay above the psychological mark of $1,800.

However, everything changed yesterday. The dollar was unable to maintain some of its positions. The opposite dynamics was also demonstrated by the bond yield. The indicator moved down after the release of data on the US labor market.

The published statistics turned out to be worse than forecasts. During the week, the number of applications for unemployment benefits in the United States increased by 51 thousand and reached the maximum value since May of 419 thousand. Meanwhile, analysts expected the indicator to decrease to 350 thousand.

Weak data on the labor market indicate that the Fed will refrain from curtailing incentives and raising interest rates in the near future. This is a wake-up call for the dollar, but a good signal for gold.

Having received support, the yellow asset closed at $1,805.40 on the New York COMEX Exchange yesterday. The difference from the previous trades was $2, or 0.1%.

Other popular metals have also grown synchronously with gold. Silver rose 0.5%, rising to $25.38. Copper added 1.5% and traded at $4.34. Platinum jumped 1.4%, reaching $1,090.60. The cost of palladium gained 1.9% and amounted to $2,704. 60.

Analysts note that the general optimism in the markets contributed to the upward movement of metals, while for gold, on the contrary, it is a deterrent factor. For this reason, the asset has been stalling in a very narrow price range for a long time.

This week, the boundaries of the corridor have narrowed even more. Now, gold is swinging sluggishly between the marks of $1,795 and $1,805. Asset prices show extremely low volatility. However, according to experts, this is a positive sign.

ActivTrades analyst Carlo Alberto De Casa says that the current consolidation gives gold an excellent opportunity to recover in the coming days, but on the condition that the US currency does not strengthen.

Meanwhile, this morning, the metal quotes remain apathetic and remain stable. Prices that have not shown a single dynamics since the beginning of the week, and under its curtain can not decide on the direction of movement.

At the time of preparation of the material, the value of the yellow asset has decreased insignificantly – by 0.05%. At the same time, bullion remained above the key level, falling to the level of $1,804.5.

Analysts are confident that next week, the apathy should be replaced by more intense traffic. The meeting of the US Federal Reserve, which is scheduled for July 27-28, will be able to stir up the quotes. Investors are waiting for new comments from the regulator on its monetary policy. Each meeting of the Federal Reserve has an impact on the dollar exchange rate, which is reflected in the value of the precious metal.